The Effect of Environmental, Social, and Governance Disclosure on Firm Value in the Property and Real Estate Sector 2022–2024

Abstract

This study aims to examine the effect of Environmental, Social, and Governance (ESG) disclosure on firm value in the property and real estate sector during the 2022–2024 period. In addition, this study investigates the role of ESG information in investor decision making compared to firm fundamental factors. A quantitative approach was employed using purposive sampling, resulting in a sample of 61 companies listed on the Indonesia Stock Exchange. The data were analyzed using panel data regression with STATA 17. The findings indicate that Environmental, Social, and Governance disclosures do not have a significant effect on firm value. These results suggest that ESG disclosure has not yet become a primary consideration for investors in evaluating firms. Companies tend to disclose ESG information mainly to comply with regulatory requirements rather than to enhance the quality of sustainability reporting. Investors place greater emphasis on financial performance indicators, such as profitability and future prospects, when making investment decisions. Therefore, ESG disclosure has not provided a strong signal in increasing firm value in the property and real estate sector.